Home building permit issues more than double in H1

The number of home building permits issued in Hungary in the first half of 2016 rose by an annual 137.2 percent to 13,236, data released by the Central Statistical Office (KSH) on Friday show.

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The number of home building permits issued in the capital rose by 190.5 percent to 3,745. In county seats and cities with over 50,000 residents, the number climbed by 175.3 percent to 3,837.

Late last year, Hungarian lawmakers lowered the VAT rate on home construction from 27 percent to 5 percent and eased rules for obtaining building permits. Around the same time, the government launched a home purchase subsidy programme for families with children.

The number of completed homes rose by 10.9 percent to 3,420 for the whole country and was up by 8.6 percent at 981 in Budapest.

Among newly built residential buildings, the percentage of detached homes dropped from 54 percent to 43 percent while that of blocks of flats rose from 35 percent to 46 percent, KSH said.

KSH noted that the percentage of homes built by property developers, as opposed to private individuals, rose from 43 percent to 54 percent in the first half.

The average size of new homes was 92sqm, down by 7 percent from a year earlier.

Analyst Laszlo Balogh of property market website ingatlan.com said the long-awaited turnaround has arrived on the market for new homes, with supply beginning to approach increased demand.

Latest data from ingatlan.com also support the market recovery, he said, adding that the number of newly built residential properties offered for sale in July was up by an annual 25 percent.